Virtual reality revenue to exceed $7bn in 2025

Consumer virtual reality content will bring in over $7 billion of global revenue in 2025, an increase of over 160 per cent on the $3 billion it is expected to generate in 2020, according to Juniper Research.

The primary driver for consumer content in this space will be console gamers, which will account for 41 per cent of revenue generated in 2025, the research firm found.

The Virtual Reality Markets: Platform Trends, Market Analysis & Forecasts 2020-2025 report expects console content revenue to be buoyed by the presence from larger developers that are often absent in most other VR platforms.

The report also notes that standalone VR will be the fastest-growing user base in the next five years, taking over from smartphone-based VR which will “stall”, following the exit of Google and Samsung from the market last year.

Juniper Research expects mobile VR to decline over the next five years, with only 1.2 million headsets in use by 2025.

The research shows that while VR is expanding to more users, it is “failing to gain the attention” of large consumer companies, with many products and services targeted towards enterprise users.

The consumer space, meanwhile, will “struggle to become mainstream”, said Juniper. Console games will be the most lucrative area here, but will still have a relatively low revenue per transaction, with an average price of $17 per VR game expected for consoles through the forecast period.

At the same time however, less than 4 per cent of console users worldwide will use the platform, making VR compatibility rather than VR exclusivity a “safer bet” for games developers.

“The price of entry remains an obstacle to many potential VR users and developers,” said research co-author James Moar. ‘We expect standalone VR to grow more rapidly, as the middle ground of affordable quality, but platform providers need to develop ways for content to be more effectively monetised in order to attract developers.”

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